Indo Zambia Bank Signs K200M ZAFFICO Funding Deal

In Short

• Indo Zambia Bank and ZAFFICO signed a K200 million funding agreement.
• The funding is under the Bank of Zambia’s Stability and Resilience Facility, also called SRF.
• ZAFFICO says the money will support forestry value addition and a particle board manufacturing plant.

What Happened

Indo Zambia Bank has signed a K200 million funding agreement with Zambia Forestry and Forest Industries Corporation, also known as ZAFFICO. The bank says the deal is backed by the Bank of Zambia’s Stability and Resilience Facility, which is a central bank funding window meant to help firms stay stable during shocks.

At the signing ceremony, Indo Zambia Bank managing director Brajesh Kumar Singh said the facility comes at a difficult time for Zambia, citing the impact of drought and ongoing electricity supply challenges.

ZAFFICO managing director Mundia Mundia said the K200 million will support the company’s “transformation agenda” by adding value to its current pine and eucalyptus species. In practice, “value addition” means processing timber locally instead of selling raw logs, which can increase margins and create new industrial jobs.

ZAFFICO said part of the plan is to establish a particle board manufacturing plant. Particle board is a wood product made by compressing wood chips and resin, and it is commonly used for furniture and construction.

Why It Matters

For Zambia’s economy, the announcement is a signal that local banks and public sector-linked companies are leaning on targeted central bank facilities to keep investment moving during climate and power stress.

For the forestry and manufacturing value chain, the plan could reduce imports of processed wood products over time. That is the “import substitution” goal ZAFFICO referenced, which means making locally what the country would otherwise buy from abroad.

More broadly, the deal ties climate resilience, industrialisation, and financing together. If the plant is built and supplied reliably, it could create demand for local suppliers, logistics providers, and downstream manufacturers such as furniture makers.